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Saturday, March 21, 2009

My Grandfather, the 14th Amendment, and the AIG Bonuses

My grandfather never graduated from high school. He spent almost his entire life in the tiny Siberian town near Novosibirsk. His greatest advice, one I wish I would follow more often, was simply this

no matter how much you make this month make sure you spend at least a penny less (though of course he would say it in Soviet currency)

Despite a lack of any real education, my grandfather built a very successful Soviet equivalent of a corner store. The store became so successful that it drew the attention of the Soviet leader at the time, Joseph Stalin. Stalin was attempting to revolutionize the economy into one totally dependent on him. As such, anyone successful on their own was someone that became a threat.

As such, Stalin sent in his henchman into my grandfather's village and arrested him on the spot. Charges were trumped up and my grandfather spent the better part of the next two decades in a Soviet gulag. He eventually lost part of his leg and the success that he built was eventually destroyed.

The 14th amendment was initially created to rid the country of the evil of slavery.

All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

Over the last nearly two centuries however, it has evolved into an amendment meant to protect Americans from the kind of tactics that Stalin used against my grandfather. The amendment means that every American is treated the exact same by the law as any other American.

Now, look at what the Congress is trying to do with the bonuses given to AIG employees. There was public outcry over these bonuses so the Congress is trying to punish everyone that received a bonus with a 90% tax. Now, on most levels the Congress is trying to do exactly what Stalin did. They are isolating certain Americans and punishing them in a way that other Americans would never be punished.

Sure, the people that are being punished likely deserve no sympathy. In fact, that's when the 14th amendment is most important. No politician would ever isolate and target a group that is sympathetic. It is those groups that are easily demonized that are most in need of the protection that the 14th amendment provides. By proposing this onerous tax that targets and isolates certain Americans the Congress perverts everything that the 14 amendment stands for.

I am no Constitutional scholar and so I won't speak to whether or not this bill is or is not Constitutional. I can however say that it in every way perverts the spirit, if not necessarily the letter, of the 14 amendment. While it may appease our populist sentiments, it also perverts everything this country should stand for.


Anonymous said...

Well said!

Anonymous said...


Anonymous said...

Mike, I think a better argument can be made that only taxing AIG bonuses would violate the Constitutional prohibition on Bills of Attainder. On the other hand, the Supreme Court has given the federal government carte blance to do what they please through the magic of the Commerce Clause.

At least that's what we discussed in our Corporate Law and Policy Seminar last week.

Anonymous said...

Just some quick thoughts...Ashwander rules, Us Citizen slavery was actually created by the 14th amendment also known as executive order 1 under lincoln because congress ajourned two weeks earlier march 27th 1861 sine die. good bye forever de jure hello de facto private law system and slavery

What would it matter what congress does as they are limited to the "10 mile square" jurisdiction of D.C. well that is if one isn't claiming us citizenship priveledges and volunteer out of their free man capacity.

Oh and another part of that executive order number 1 is that you are not allowed to question the debt. Slaves have no say in the master's matters.